SBS Bank reports continued growth in competitive environment

MEDIA RELEASE
4 June 2019

SBS Bank’s full-year result shows strong performance in its 150th Year

Continued growth in the core residential lending and a strong performance in its consumer finance subsidiary has boosted SBS Bank Group’s financial results, with a 15.5% increase in operating surplus for the year ending 31 March 2019.

SBS Bank chairman John Ward said with SBS Bank marking its 150th anniversary, it was incredibly pleasing to see the organisation performing so well and in such good financial health.

The Invercargill-based group, which includes subsidiaries Finance Now, FANZ and Southsure, has reported an operating surplus of $40.8 million, up from $35.3 million in the previous year. Members’ Equity is up $29.4 million, or 10% on last year, to $324 million.

SBS Bank’s total capital ratio has increased across the year to 14.18% due to moderation of growth relative to profit and the issuing of Capital Bonds and remains well above the regulatory minimum (8%), Mr Ward said.

“One of the highlights of the result is the contribution of all of our entities as well as balanced growth, with lending up $181 million (5%) on last year, alongside strong retail funding growth, up $191 million (6%).

“While SBS Bank has been a key contributor with improved profitability due to asset growth and improved productivity, this also reflects another significant contribution of our Finance Now business,” he said.

“The integration of The Warehouse Group Financial Services, bought in the 2018 financial year, contributed to a strong performance from Finance Now and enabled the group to provide additional services and benefits.”

Group chief executive Shaun Drylie said other key developments over the past year included SBS acquiring the remaining 15% of FANZ to take full ownership; SBS via FANZ acquiring the remaining 50% of Staples Rodway Asset Management (SRAM); the implementation of technology that makes it possible for Members to apply for and open term investments online; the launch of the Capital Bond product into the Australian market; and a bank statement elimination project that removed the need for more than 2 million pieces of paper.

“Our Members’ needs have been our focus for 150 years and they will continue to be at the forefront of our organisation into the future,” Mr Drylie said.

“Our profits remain in New Zealand and provide us with the opportunity to continue doing what we do, so these results will reinforce our Members’ confidence in their bank.”

ENDS

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